Half of Colorado's School Districts May Seek Local Tax Hikes

A move by Colorado legislators earlier this year to tighten
restrictions on one form of state aid to school districts is forcing
more districts than ever before to appeal to local voters for school
operating funds.

More than 40 percent, or 77, of the state's 181 school districts
have said they may ask for tax increases at the polls in October or
November, state officials reported this month. In the past, the highest
number of districts to seek local tax increases in any one year was 20,
according to Dan Stewart, supervisor of state finances in the state
department of education.

Colorado school districts are supported by an approximately 50-50
mix of state and local funds, officials said.

The districts' sudden need for new funds stems from the state
legislature's approval of a bill placing a limit on the amount of money
that the Colorado State School Budget Review Board can allocate to
them. Legislators, who have been trying to trim state spending by $58
million to avoid a deficit, which is illegal in Colorado, approved a
$1-million cap on the board's annual allocation to any one
district.

Districts May Appeal

The board was established by the state's controversial 1973 Public
School Finance Act, which was ruled constitutional last year by the
Colorado Supreme Court. Under that act, districts that wish to increase
their budgets by more than about 7 percent in any one year have to
appeal first to the review board for the funds, Mr. Stewart said. If
they are not satisfied with the review board's decision, they can then
appeal to the voters.

"The point of the board was to give school boards a chance to get
funding without going to the voters," Mr. Stewart said.

But many legislators found the board's policy too lenient. Between
1974, when the it started operations, and 1982, the review board
received requests from 157 districts and allocated a total of $197
million, Mr. Stewart said. "Now they [the legislators] think the
districts should go to the voters first."

Some of the districts being forced by dwindling state revenues to
turn to the voters for a tax increase are doing so for the first
time.

And their officials say they are disturbed by the high cost of
running an election--for which district officials must pay, under state
law--and the uncertainty of the process.

The new cap on the review board's allocations hits the large
districts hardest. Jefferson County, which has a budget of $218
million, applied to the board six times in eight years and usually
received several million dollars, said Betsey Jay, a spokesman for the
district, which is the largest in the state. "Now, with the $1-million
limit, it's basically useless," she said.

"In our 32-year history, we've never gone to the voters for
operating funds," said Ms. Jay. "We've held out, we've made
adjustments, we've done a little trimming here and there. Now, there is
no other recourse for us," she added.

This year, for the first time, Jefferson County will try to meet its
anticipated $12-million shortfall with new local-property-tax revenues,
Ms. Jay said. In the past, the district has taken only bond issues to
the voters, she said. The district has already set Oct. 18 for a
property-tax referendum; officials estimate the election will cost
about $27,000.

The Denver School District, the state's second largest, is facing an
$18-million shortfall in this year's budget, and also plans to appeal
to voters this fall to close the gap, administrators there said.

The Denver district is also threatened by a recommendation made this
month by the state legislature's Joint Budget Committee to trim state
aid for student transportation (as well as for other programs). Denver
spends about $2.9 million a year on transportation, partly because it
is under a 1973 court order to integrate its schools. The proposal,
which marks the first time lawmak-ers have suggested cutting
transportation funds, would cut the district's busing funds by about 17
percent, a district spokesman said.

The budget committee's recommendation proposes $19 million in cuts
from the state's $700-million budget for public schools, including $2.4
million from busing funds, $2.9 million from programs for handicapped
children, and $12.9 million from the general-fund budget for school
districts.

The recommendation, if formally approved by the committee, will go
to the full legislature next month. Observers said they believe most
committee members support the proposals.

Rep. Bob Leon Kirscht, vice chairman of the committee, said the
state should subsidize only long-distance busing in rural districts and
the shorter routes in urban districts should be locally funded. "That's
the parents' and children's responsibility," he said, adding that
busing for short routes encourages "lazy children."

Furthermore, the court order under which Denver schools operate
should be rewritten to reduce the amount of required busing, he said,
because it is "unfair" to make taxpayers in other school districts
support Denver's special costs.

Vol. 02, Issue 42

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